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Connecticut Bankruptcy Law Blog

Eligibility requirements for Chapter 13 bankruptcy

Individuals who are burdened with personal debt and fear being cleaned out by creditors or are looking for alternatives to foreclosure may see filing for Chapter 13 bankruptcy in Connecticut court as an attractive option. While Chapter 13 presents clear benefits, this form of bankruptcy is not open to everyone. Anyone seeking to file Chapter 13 must meet certain criteria.

According to the Findlaw site, one of the most obvious requirements is that Chapter 13 is restricted to those filing as individuals or jointly as spouses. This means if a person owns a business that is a corporation and a limited liability company, that individual would have to file for Chapter 11 protection instead. However, since money earned as a sole proprietor is indistinguishable from a person’s own personal income, filing Chapter 13 for personal debts is permitted. A business owner in a partnership can also file Chapter 13. On the other hand, commodity brokers and stockbrokers cannot file for Chapter 13.

Understanding the power of short sale agreements

Navigating the language associated with Connecticut mortgage agreements might be challenging for those unfamiliar with real estate or finance. This challenge is compounded if the need for understanding comes along with a stressful situation, such as a bank compelling a homeowner to satisfy debt agreements. Regardless of the situation, it could benefit mortgagees to know their options. Here is some information on the loss mitigation process, one such alternative to formal foreclosure.

The United States Consumer Financial Protection Bureau lists the definition of short sale as a type of loss mitigation that involves the mortgagor allowing a mortgagee to sell a property for less than amount remaining on the mortgage. The negotiation process surrounding these types of sales might be complex: It typically involves all stakeholders in a debt. The agreement between the parties commonly sets an acceptable sale price and makes conditions for any future responsibility, or lack thereof, on the part of the debtor.

What are the advantages and disadvantages of bankruptcy?

Reaching the decision to declare bankruptcy usually isn’t easy. Many people still have a negative perception of bankruptcy, even though it can sometimes be the best way to start a clean slate financially. Even so, bankruptcy has far-reaching implications for your credit score, your debt and your current and future financial stability. It can have negative consequences, but it also has strong benefits.

When considering declaring bankruptcy, take some time to carefully weigh the pros and cons. What follows is a list of some of the most important advantages and disadvantages of bankruptcy: